In January 2021, when the Arizona Legislature goes back into session, we will be faced with major decisions in the wake of the COVID19 pandemic.
If Democrats take control of one or both chambers in the Legislature, it will be a New Day in Arizona, after 50 years of Republican control.
My goals for the future are to improve the public health and financial state of Arizona, as we rebuild from COVID19 or learn to live with it.
The post-COVID19 world will be different from “the before times” and hopefully better. In my opinion, the past will never return exactly as it was, and we have to plan for that. Travel, tourism, consumerism, healthcare, entertainment, K-12 schools, higher education, work life, prisons … many changes will come in these areas and others, whether we want substantive change or not.
Our job is to create the world we want. Here are some of my priorities for 2021 and beyond.
President Trump and Congress have been bailing out businesses with multiple Coronavirus relief packages. One business they haven’t helped is the US Postal Service. In fact, Trump has suggested shutting down the post office and privatizing the services.
I think that is a terrible idea for the American public. The US Postal Service (USPS) is the general public’s most cost-effective and convenient way to send letters and packages to other people in this country. The Postal Service was created by the Founding Fathers because they realized how important it was for us to stay in communication with each other and with the government.￼ President Thomas Jefferson even wanted the newspaper to be delivered free to every person in the US to keep us informed.
Privatization of government services never benefits the people. I can’t think of any instance in which a service was privatized, and the people actually got better service and/or more cost-effective service. With privatization, the service always gets worse, more expensive, and less widespread and universal.￼ It’s costs 55 cents for one first class postage stamp; that is the cost to mail a letter to anyone in the US. To send a Fed Ex letter, it costs $8.50– or $11 if the letter’s destination is more than 601 miles away. Plus, you have to take the letter to Fed Ex to mail it. Privatization is about making money. It’s not about providing quality, low-cost services in a non-discriminatory way, across the entire country equally for everybody.￼ That’s what the Postal Service gives us. If Trump succeeds in privatizing the postal service, thousands of union workers will lose their jobs, costs will skyrocket, convenience will be lost, and people in remote areas will lose mail service or pay ridiculous prices in order to guarantee a profit.
Instead of “Ditat Deus” (God Enriches), Arizona’s motto should be “Tax Cuts R Us.”
Today in the Ways and Means Committee, we heard three tax giveaway bills: HB229 (corporate welfare for utility companies); HB2355 and HB2356 (increases to the 25% charitable tax credit passed in 2019); and HB2358 (increases to the dependent tax credit).
HB2293 exempts the purchase of electric storage units from sales tax (AKA Transaction Privilege Tax or TPT) and from use tax. When I asked Rep. Tim Dunn, the sponsor of the bill, who benefits from this, he said the utility companies benefit from it, but consumers will see a financial benefit because their rates will go down. (Really? When has that ever happened?)
The industry lobbyist made many circular arguments trying to convince us that giving utilities a tax break was good for consumers. Currently, there are eight rate increase cases before the Arizona Corporation Commission (ACC), including rate increase requests from APS and other electric utilities. When I started talking about rate increases and the relationship to infrastructure investment by utility companies, Committee Chair Ben Toma said that I was off-topic. Dunn and the energy lobbyist were the ones that said giving APS, TEP and SRP a tax break was going to lower costs to consumers. I believe that I was totally on topic when I said that these things were likely to raise our rates in the long term, not lower them.
Tax conformity with the Trump tax plan which was passed by Congress in December 2017 has been loping along in the Arizona Legislature … until today. This morning, the former Speaker and current Senator JD Mesnard did a presentation on what he wants us to pass for tax conformity. He has been quoted in the newspaper as saying that he wants tax conformity to be “revenue neutral”.
If Arizona decides to do full tax conformity, as Governor Ducey has suggested, Arizona will gain an estimated $150-$200 million per year extra for the general fund. If we do revenue neutral tax conformity as Mesnard has suggested, we will throw that extra $150-200 million revenue out the window by offering tax cuts along with tax conformity.
The December 2017 Trump tax plan raised the standard deduction and eliminated some itemized deductions. If you make less than a six-figure salary and you don’t itemize your taxes, you will be better off with tax conformity.
In order to ram these bills through the committees, the Senate Finance Committee and the House Ways and Means Committee have been rescheduled for Monday, January 28 at 10 AM. This is not the regular meeting time. We are required to vote on HB2522 and SB1143 simultaneously.
These bills were placed on agendas late today. If you are on Request to Speak (RTS), you have until Monday morning to voice your opinion. If you believe that Arizona should say “NO!” to more tax cuts and should use the money to cover state needs (or prop up the rainy day fund in the event of a Wall Street downturn), you want clean tax conformity— NOT revenue-neutral tax conformity as HB2522 and SB1143 propose. All hands on deck.
President Trump started the third government shutdown of 2018 on December 22. As of today, January 12, 2019, the government is still shut down. Some federal workers have been furloughed and are not being paid. Others are required to work and are not being paid. It’s time to stop playing around with people’s lives. We need better schools, better roads, and a federal government that works. We don’t need a wall, and we don’t need a president who plays with people’s lives.
President Trump refused to sign a bipartisan budget bill in December 2018 and started what will soon be the longest government shutdown in US history. Millions of workers been furloughed and are not being paid. Other federal workers are working for free. It’s time to open the government and put people back to work.